Why is Chevron produce oil costing $70/barrel?

"Chevron says the project will be profitable as long as oil prices stay above $60 or $70 per barrel, well below Mondayâs level of $97.70."

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We got so many reserves in Arabian Peninsula costing less than $10/barrel to produce oil and yet Chevron is pursuing this project. There are many reserves in the world that will cost much less than $70/barrel all around the world and yet Chevron's cost is $70????

Because the demand is higher than the volume of cheap stuff that can be produced. And every barrel of cheap oil that gets depleted off the market or is used internally instead of being exported is replaced by a barrel of very expensive oil.

It does not make sense to produce oil for $70 when many wells in Arabian peninsula costing less than $10

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It makes perfect sense if you don't have access to the $10 oil, or if there isn't enough of it, or if the producer of said cheap oil is maximizing their own economic potential by not pumping balls-out.

The bottom line is if the supply of $10 oil were sufficient, oil would be $10. It's not, therefore, it's not.